eBay clamps down on bitcoin sales in the UK

New rules will prevent sellers auctioning bitcoin from 10 February, the ecommerce site has told users

eBay UK is to limit sales of bitcoin to its classified advertising platform from February 10, banning the currency from its auction and buy-it-now formats.

After the change comes into force, merchants will only be able to sell bitcoin through the classified ads format, which requires the buyer to contact the seller directly, without obligation.

"To promote a trustworthy marketplace and ensure compliance with applicable regulations, eBay is currently updating its currency policy," the site said in a statement. "The updated policy will clarify that listings for Bitcoin and other similar virtual currencies must be listed in the virtual currency category in the classified ad format.

"The virtual currency category is expected to be available on the UK site on February 10th."

Bitcoin transactions are unusual in that they are (comparatively) instantaneous and irreversible. Under eBay's normal auction rules, this could leave the site open to fraud, with a buyer purchasing bitcoins and then refusing to pay, or initiating a credit-card chargeback. By switching to the classified ads model, where users pay for an ad up front and eBay takes no part in settling the deal, the site removes itself from the risky end of the transaction.

At the current exchange rate, 0.02 BTC is worth around £12, which might explain why the majority of bitcoin-related sales are for computer hardware called ASIC miners. These are specialised chips that allow users to "mine" bitcoin more efficiently than if they just use a normal computer.

Despite the fact that the changes in policy massively reduce the scope for bitcoin trading using the eBay platform, many organisations, including This Is Money and ZDnet have reported the news as a positive step for the currency.

While many high-up staff at eBay's executive team have said nice things about bitcoin, with PayPal's president David Marcus saying "we're believers in BTC", Bitcoin fans may conclude the acts speak for themselves.